HF 2480

as introduced - 81st Legislature (1999 - 2000) Posted on 12/15/2009 12:00am

  1.1                          A bill for an act 
  1.2             relating to retirement; teacher retirement plans; 
  1.3             adjusting benefit coverage to account for certain 
  1.4             extracurricular activity management compensation 
  1.5             amounts; requiring rulemaking by the commissioner of 
  1.6             children, families, and learning; amending Minnesota 
  1.7             Statutes 1998, sections 354.05, by adding 
  1.8             subdivisions; 354.07, by adding a subdivision; 354.44, 
  1.9             subdivision 6; 354.46, subdivision 1; 354A.011, by 
  1.10            adding subdivisions; 354A.021, by adding a 
  1.11            subdivision; and 354A.31, subdivisions 4 and 4a; 
  1.12            proposing coding for new law in Minnesota Statutes, 
  1.13            chapters 122A; 354; and 354A. 
  1.14  BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.15                             ARTICLE 1 
  1.16                  TEACHERS RETIREMENT ASSOCIATION 
  1.17                EXTRACURRICULAR ACTIVITY MANAGEMENT 
  1.18                          BENEFIT COVERAGE 
  1.19     Section 1.  Minnesota Statutes 1998, section 354.05, is 
  1.20  amended by adding a subdivision to read: 
  1.21     Subd. 35b.  [BASE SALARY.] (a) For an elementary or 
  1.22  secondary school teacher, "base salary" means the annual 
  1.23  contract or equivalent regular salary of the teacher for the 
  1.24  teacher's regular teaching duties and does not include 
  1.25  extracurricular activity compensation. 
  1.26     (b) For any other teacher, including a school district 
  1.27  superintendent or an elementary or secondary school principal or 
  1.28  other administrator, base salary means salary as defined in 
  1.29  subdivision 35. 
  2.1      Sec. 2.  Minnesota Statutes 1998, section 354.05, is 
  2.2   amended by adding a subdivision to read: 
  2.3      Subd. 35c.  [EXTRACURRICULAR ACTIVITY 
  2.4   COMPENSATION.] "Extracurricular activity compensation" means 
  2.5   that portion of the compensation for teaching services paid to a 
  2.6   teacher covered by subdivision 35b, paragraph (a), for 
  2.7   extracurricular activity management. 
  2.8      Sec. 3.  Minnesota Statutes 1998, section 354.05, is 
  2.9   amended by adding a subdivision to read: 
  2.10     Subd. 35d.  [EXTRACURRICULAR ACTIVITY MANAGEMENT.] (a) 
  2.11  "Extracurricular activity management," for purposes of 
  2.12  subdivisions 35b and 35c, means a teaching duty that has 
  2.13  substantial direct student contact, is performed by an 
  2.14  elementary or secondary school teacher for a separate or 
  2.15  determinable amount of compensation, is performed in addition to 
  2.16  the person's regular or base teaching duties, and is not 
  2.17  uniformly performed by all or substantially all other similarly 
  2.18  situated teachers. 
  2.19     (b) Extracurricular activity management includes the 
  2.20  management of interscholastic and intramural competitive 
  2.21  activities. 
  2.22     (c) Extracurricular activity management does not include 
  2.23  any activities by a school district superintendent or an 
  2.24  elementary or secondary school principal or other category of 
  2.25  school administrator. 
  2.26     Sec. 4.  Minnesota Statutes 1998, section 354.05, is 
  2.27  amended by adding a subdivision to read: 
  2.28     Subd. 35e.  [AVERAGE SALARY.] "Average salary" means the 
  2.29  period of base salary as defined in subdivision 35b upon which 
  2.30  contributions were made that produces the highest amount for a 
  2.31  five successive-year period of formula service credit, but not 
  2.32  to exceed the equivalent of 60 successive monthly applicable 
  2.33  compensation payments, or for all years of formula service 
  2.34  credit if the person has credit for less than five years of 
  2.35  formula service. 
  2.36     Sec. 5.  Minnesota Statutes 1998, section 354.07, is 
  3.1   amended by adding a subdivision to read: 
  3.2      Subd. 10.  [BASE SALARY AND EXTRACURRICULAR ACTIVITY 
  3.3   COMPENSATION REPORTING.] (a) The board shall adopt necessary 
  3.4   standards for the reporting of base salary amounts and 
  3.5   extracurricular activity compensation amounts.  Reporting of 
  3.6   base salary amounts and extracurricular activity compensation 
  3.7   amounts is the responsibility of an employing unit with members 
  3.8   covered by the fund.  An employing unit with a member covered by 
  3.9   the fund who manages an extracurricular activity must comply 
  3.10  with the standards in reporting salary and compensation amounts. 
  3.11     (b) No amount may be credited as extracurricular activity 
  3.12  compensation paid before July 1, 2000, unless the teacher 
  3.13  involved supplies adequate documentation of the amount of the 
  3.14  extracurricular teaching activity compensation and the length of 
  3.15  the extracurricular teaching activity management service.  The 
  3.16  extracurricular teaching activity compensation must have been 
  3.17  salary subject to member contributions at the time the service 
  3.18  was rendered.  The documentation must be supplied at least six 
  3.19  months before the teacher's effective date of retirement. 
  3.20     (c) The board shall establish standards for the 
  3.21  documentation required to be provided by a teacher to establish 
  3.22  the existence and amount of any extracurricular activity 
  3.23  compensation received before July 1, 2000.  Pre-July 1, 2000, 
  3.24  extracurricular activity compensation is only creditable if 
  3.25  contemporaneous member contributions were made on the 
  3.26  extracurricular activity compensation amount.  The documentation 
  3.27  standards may not unreasonably differentiate between the various 
  3.28  types of teaching personnel engaged in extracurricular activity 
  3.29  management and may not differentiate between the various school 
  3.30  districts in a given school year. 
  3.31     Sec. 6.  Minnesota Statutes 1998, section 354.44, 
  3.32  subdivision 6, is amended to read: 
  3.33     Subd. 6.  [COMPUTATION OF FORMULA PROGRAM RETIREMENT 
  3.34  ANNUITY.] (1) (a) The formula retirement annuity must be 
  3.35  computed in accordance with using the applicable provisions of 
  3.36  the formulas stated in clause (2) or (4) paragraph (b) or (d) on 
  4.1   the basis of each the member's average salary for the period of 
  4.2   the member's formula service credit.  
  4.3      For all years of formula service credit, "average salary," 
  4.4   for the purpose of determining the member's retirement annuity, 
  4.5   means the average salary upon which contributions were made and 
  4.6   upon which payments were made to increase the salary limitation 
  4.7   provided in Minnesota Statutes 1971, section 354.511, for the 
  4.8   highest five successive years of formula service credit 
  4.9   provided, however, that such "average salary" shall not include 
  4.10  any more than the equivalent of 60 monthly salary payments.  
  4.11  Average salary must be based upon all years of formula service 
  4.12  credit if this service credit is less than five years. 
  4.13     (2) (b) This clause paragraph, in conjunction with clause 
  4.14  (3) paragraph (c), applies to a person who first became a member 
  4.15  of the association or a member of a pension fund listed in 
  4.16  section 356.30, subdivision 3, before July 1, 1989, 
  4.17  unless clause (4) paragraph (d), in conjunction with clause 
  4.18  (5) paragraph (e), produces a higher annuity amount, in which 
  4.19  case clause (4) paragraph (d) applies.  The average salary as 
  4.20  defined in clause (1) section 354.05, subdivision 35e, 
  4.21  multiplied by the following percentages per year of formula 
  4.22  service credit shall determine, determines the amount of the 
  4.23  annuity to which the member qualifying therefor is entitled: 
  4.24                         Coordinated Member   Basic Member
  4.25  Each year of service     the percent        the percent
  4.26   during first ten        specified in       specified in
  4.27                           section 356.19,    section 356.19,
  4.28                           subdivision 1,     subdivision 3,
  4.29                           per year           per year
  4.30  Each year of service     the percent        the percent
  4.31   thereafter              specified in       specified in
  4.32                           section 356.19,    section 356.19,
  4.33                           subdivision 2,     subdivision 4,
  4.34                           per year           per year
  4.35     (3) (c)(i) This clause paragraph applies only to a person 
  4.36  who first became a member of the association or a member of a 
  5.1   pension fund listed in section 356.30, subdivision 3, before 
  5.2   July 1, 1989, and whose annuity is higher when calculated 
  5.3   under clause (2) paragraph (b), in conjunction with this clause 
  5.4   paragraph than when calculated under clause (4) paragraph (d), 
  5.5   in conjunction with clause (5) paragraph (e). 
  5.6      (ii) Where any member retires prior to before the normal 
  5.7   retirement age under a formula annuity, the member shall be paid 
  5.8   is entitled to a retirement annuity in an amount equal to the 
  5.9   normal annuity provided in clause (2) paragraph (b), reduced by 
  5.10  one-quarter of one percent for each month that the member is 
  5.11  under normal retirement age at the time of retirement except 
  5.12  that for any member who has 30 or more years of allowable 
  5.13  service credit, the reduction shall be applied is applicable 
  5.14  only for each month that the member is under age 62. 
  5.15     (iii) Any member whose attained age plus credited allowable 
  5.16  service totals 90 years is entitled, upon application, to a 
  5.17  retirement annuity in an amount equal to the normal annuity 
  5.18  provided in clause (2) paragraph (b), without any reduction by 
  5.19  reason of early retirement. 
  5.20     (4) (d) This clause paragraph applies to a member who has 
  5.21  become at least 55 years old and first became a member of the 
  5.22  association after June 30, 1989, and to any other member who has 
  5.23  become at least 55 years old and whose annuity amount when 
  5.24  calculated under this clause paragraph and in conjunction with 
  5.25  clause (5) paragraph (e), is higher than it is when calculated 
  5.26  under clause (2) paragraph (b), in conjunction with clause 
  5.27  (3) paragraph (c).  The average salary, as defined in clause (1) 
  5.28  section 354.05, subdivision 35e, multiplied by the percent 
  5.29  specified by section 356.19, subdivision 4, for each year of 
  5.30  service for a basic member and by the percent specified in 
  5.31  section 356.19, subdivision 2, for each year of service for a 
  5.32  coordinated member shall determine determines the amount of the 
  5.33  retirement annuity to which the member is entitled. 
  5.34     (5) (e) This clause paragraph applies to a person who has 
  5.35  become at least 55 years old and first becomes a member of the 
  5.36  association after June 30, 1989, and to any other member who has 
  6.1   become at least 55 years old and whose annuity is higher when 
  6.2   calculated under clause (4) paragraph (d) in conjunction with 
  6.3   this clause paragraph than when calculated under clause 
  6.4   (2) paragraph (b), in conjunction with clause (3) paragraph 
  6.5   (c).  An employee who retires under the formula annuity before 
  6.6   the normal retirement age shall be paid is entitled to the 
  6.7   normal annuity provided in clause (4) paragraph (d), reduced so 
  6.8   that the reduced annuity is the actuarial equivalent of the 
  6.9   annuity that would be payable to the employee if the employee 
  6.10  deferred receipt of the annuity and the annuity amount were 
  6.11  augmented at an annual rate of three percent compounded annually 
  6.12  from the day the annuity begins to accrue until the normal 
  6.13  retirement age. 
  6.14     Sec. 7.  Minnesota Statutes 1998, section 354.46, 
  6.15  subdivision 1, is amended to read: 
  6.16     Subdivision 1.  [BASIC PROGRAM; BENEFITS FOR SPOUSE AND 
  6.17  CHILDREN OF TEACHER.] (a) If a basic member who has at least 18 
  6.18  months of allowable service credit and who has an average salary 
  6.19  as defined in section 354.44 354.05, subdivision 6 35e, equal to 
  6.20  or greater than $75 dies prior to before retirement or if a 
  6.21  former basic member who, at the time of death, was totally and 
  6.22  permanently disabled and receiving disability benefits pursuant 
  6.23  to under section 354.48 dies before attaining age 65 or reaching 
  6.24  the five-year anniversary of the effective date of the 
  6.25  disability benefit, whichever is later, the surviving spouse and 
  6.26  dependent children of the basic member or former basic member 
  6.27  are entitled to receive a monthly benefit as follows: 
  6.28    (a) (1) Surviving
  6.29    spouse .....50 percent of the basic member's monthly
  6.30                average salary paid in the last full
  6.31                fiscal year preceding death
  6.32    (b) (2) Each
  6.33    dependent
  6.34    child ......ten percent of the basic member's
  6.35                monthly average salary paid in the
  6.36                last full fiscal year preceding death
  7.1      (b) Payments for the benefit of any dependent child under 
  7.2   the age of 22 years must be made to the surviving parent, or if 
  7.3   there be none, to the legal guardian of the child.  The maximum 
  7.4   monthly benefit must not exceed is $1,000 for any one family, 
  7.5   and the minimum benefit per family must not be less than is 50 
  7.6   percent of the basic member's average salary, subject to the 
  7.7   foregoing maximum.  The surviving dependent children's benefit 
  7.8   must be reduced pro tanto when any surviving child is no longer 
  7.9   dependent. 
  7.10     (c) If the basic member and the surviving spouse are killed 
  7.11  in a common disaster and if the total of all survivors benefits 
  7.12  payable pursuant to under this subdivision is less than the 
  7.13  accumulated deductions plus interest payable, the surviving 
  7.14  dependent children shall are entitled to receive the difference 
  7.15  in a lump sum payment. 
  7.16     (d) If the survivor benefits provided in this subdivision 
  7.17  exceed in total the monthly average salary of the deceased basic 
  7.18  member, these benefits must be reduced to an amount equal to the 
  7.19  deceased basic member's monthly average salary. 
  7.20     Prior to (e) Before payment of any survivor benefit 
  7.21  pursuant to under this subdivision, in lieu of that benefit, the 
  7.22  surviving spouse may elect to receive the joint and survivor 
  7.23  annuity provided pursuant to under subdivision 2, or may elect 
  7.24  to receive a refund of accumulated deductions with interest in a 
  7.25  lump sum as provided pursuant to under section 354.47, 
  7.26  subdivision 1.  If there are any surviving dependent children, 
  7.27  the surviving spouse may elect to receive the refund of 
  7.28  accumulated deductions only with the consent of the district 
  7.29  court of the district in which the surviving dependent child or 
  7.30  children reside. 
  7.31     Sec. 8.  [354.515] [DEFINED CONTRIBUTION BENEFIT DERIVED 
  7.32  FROM CONTRIBUTIONS ON EXTRACURRICULAR COMPENSATION.] 
  7.33     Subdivision 1.  [POST-JULY 1, 2000, CONTRIBUTIONS.] (a) 
  7.34  Member contributions on extracurricular compensation received by 
  7.35  a teacher after June 30, 2000, and the related employer 
  7.36  contributions, after deduction of the applicable amount 
  8.1   representing administrative expenses, must be deposited in a 
  8.2   separate account established for the member and must be used to 
  8.3   purchase shares in one or more account of the Minnesota 
  8.4   supplemental investment fund under section 11A.17.  The teacher 
  8.5   must specify, on a form prescribed by the executive director, 
  8.6   the percentage of the total contribution available for deposit 
  8.7   to be used to purchase shares in each account of the 
  8.8   supplemental investment fund. 
  8.9      (b) The teacher may indicate, in writing on a form 
  8.10  prescribed by the executive director, a choice of options for 
  8.11  subsequent purchases of shares.  The choice filed governs the 
  8.12  purchase of shares until a different choice is filed.  If no 
  8.13  initial option is chosen, 100 percent of the available 
  8.14  contribution amounts must be used to purchase shares in the 
  8.15  income share account.  A change in the investment option is 
  8.16  effective no later than the first compensation payment date 
  8.17  first occurring 30 days after the change form is filed. 
  8.18     (c) A teacher also may change the investment option that 
  8.19  was selected for all or a portion of the shares in the 
  8.20  supplemental investment fund previously purchased.  Changes in 
  8.21  past investment options must be effected as soon as the cash 
  8.22  flow to the applicable account practically permits, but not 
  8.23  later than six months after the requested change. 
  8.24     Subd. 2.  [PRE-JULY 1, 2000, CONTRIBUTIONS.] (a) Member 
  8.25  contributions on pre-July 1, 2000, documented or reported 
  8.26  extracurricular activity compensation and the related employer 
  8.27  contributions, after deduction of the accumulated administrative 
  8.28  expense, plus investment income on those amounts credited at the 
  8.29  rate credited to members accounts under section 354.44, 
  8.30  subdivision 2, must be deducted from the teachers retirement 
  8.31  fund, transferred to the Minnesota supplemental investment fund, 
  8.32  and deposited to the credit of the separate account of the 
  8.33  teacher. 
  8.34     (b) Reported extracurricular activity compensation is 
  8.35  compensation for extracurricular teaching services that the 
  8.36  applicable school district has certified to the executive 
  9.1   director as having been paid before July 1, 2000.  The executive 
  9.2   director may request additional verification as to the amount 
  9.3   and the nature of the reported extracurricular activity 
  9.4   compensation and makes the final determination of the amounts 
  9.5   appropriate for transfer.  The decision of the executive 
  9.6   director is appealable under section 354.071. 
  9.7      (c) Documented extracurricular activity compensation is 
  9.8   compensation paid before July 1, 2000, for extracurricular 
  9.9   teaching services that the applicable teacher has identified by 
  9.10  supplying copies of applicable teaching contracts, federal 
  9.11  Internal Revenue documents, and other relevant information.  The 
  9.12  executive director may request additional information from the 
  9.13  teacher or from the applicable school district as to the amount 
  9.14  and the nature of the documented extracurricular activity 
  9.15  compensation and makes the final determination of the amounts 
  9.16  appropriate for transfer.  The decision of the executive 
  9.17  director is applicable under section 354.071. 
  9.18     Subd. 3.  [DEFINED CONTRIBUTION RETIREMENT ANNUITY.] (a) 
  9.19  Upon retirement under section 354.44, the retiring teacher is 
  9.20  also eligible to receive a defined contribution retirement 
  9.21  annuity under this section.  The value of the shares to the 
  9.22  credit of the retiring teacher must be transferred to the 
  9.23  Minnesota postretirement investment fund.  The annuity must be 
  9.24  based on the amount to the credit of the retiring teacher and 
  9.25  the age of the retiring teacher at retirement, calculated under 
  9.26  the reserve basis used by the teachers retirement association in 
  9.27  determining pensions and reserves. 
  9.28     (b) An annuity under this subdivision accrues on the first 
  9.29  day of the first full month after the retirement application is 
  9.30  received or after teaching service terminates, whichever is 
  9.31  later.  
  9.32     Subd. 4.  [DEFINED CONTRIBUTION DISABILITY BENEFIT.] (a) A 
  9.33  teacher covered by this section, upon becoming totally and 
  9.34  permanently disabled, has the option to receive: 
  9.35     (1) the value of the person's total shares; or 
  9.36     (2) an annuity under subdivision 3 based on the value of 
 10.1   the person's total shares. 
 10.2      (b) The disability benefit accrues on the first day of the 
 10.3   month next following the date of disability. 
 10.4      (c) The disability benefit must be based on the 
 10.5   disabilitant's age when the benefit begins to accrue.  The 
 10.6   shares to the credit of the disabilitant in the Minnesota 
 10.7   supplemental investment fund must be valued as of the end of the 
 10.8   month following authorization of the payment of the disability 
 10.9   benefit. 
 10.10     (d) The disability benefit is not subject to any reduction 
 10.11  for amounts received or receivable under the applicable workers' 
 10.12  compensation laws. 
 10.13     (e) A person who returns to teaching after receiving 
 10.14  disability benefits must have those disability benefits 
 10.15  suspended pending the payment of a future retirement annuity 
 10.16  under subdivision 3.  Upon returning to teaching, the person is 
 10.17  not obligated or permitted to repay any previously received 
 10.18  disability benefits. 
 10.19     Subd. 5.  [DEFINED CONTRIBUTION DEATH BENEFIT.] (a) If a 
 10.20  teacher covered by this section dies leaving a spouse and having 
 10.21  no named beneficiary, the spouse has the option to receive: 
 10.22     (1) the value of the decedent's total shares; or 
 10.23     (2) an annuity when the spouse attains the age of 55 years, 
 10.24  calculated under subdivision 3 based on the value of the 
 10.25  decedent's total shares. 
 10.26     (b) If a teacher covered by this section dies and has named 
 10.27  a beneficiary, the beneficiary is entitled to receive the value 
 10.28  of the decedent's total shares. 
 10.29     (c) If a teacher covered by this section dies and leaves no 
 10.30  spouse, has named no beneficiary, but leaves a surviving child, 
 10.31  surviving children, a surviving parent, or surviving parents, 
 10.32  the value of the decedent's total shares are payable to the 
 10.33  child or to the children in equal shares, or if none, to the 
 10.34  surviving parent or to the surviving parents in equal shares. 
 10.35     (d) If a teacher covered by this section dies leaving no 
 10.36  surviving spouse, surviving child, or surviving parent and has 
 11.1   not named a beneficiary, the decedent's estate is entitled to 
 11.2   the value of the decedent's total shares. 
 11.3      (e) A decedent's total shares must be valued as of the end 
 11.4   of the month following the teacher's death. 
 11.5      Subd. 6.  [DEFINED CONTRIBUTION WITHDRAWAL BENEFIT.] (a) No 
 11.6   withdrawal of amounts from the account of a teacher covered by 
 11.7   this section may occur before the termination of teaching 
 11.8   service. 
 11.9      (b) Upon the termination of teaching service or thereafter, 
 11.10  a former teacher, upon application, is entitled to withdraw the 
 11.11  value of the person's total shares.  The withdrawal benefit is 
 11.12  payable 30 days following the termination of teaching service or 
 11.13  30 days following the filing of the application for the benefit, 
 11.14  whichever is later. 
 11.15     (c) The share value for a withdrawal benefit must be 
 11.16  determined as of the end of the month following the filing of 
 11.17  the application for the benefit. 
 11.18     (d) The withdrawal benefit may not be repaid. 
 11.19     Sec. 9.  [EFFECTIVE DATE.] 
 11.20     Sections 1 to 8 are effective on July 1, 2000. 
 11.21                             ARTICLE 2 
 11.22           FIRST CLASS CITY RETIREMENT FUND ASSOCIATIONS 
 11.23                EXTRACURRICULAR ACTIVITY MANAGEMENT 
 11.24                          BENEFIT COVERAGE 
 11.25     Section 1.  Minnesota Statutes 1998, section 354A.011, is 
 11.26  amended by adding a subdivision to read: 
 11.27     Subd. 7a.  [AVERAGE SALARY.] "Average salary" means the 
 11.28  period of base salary as defined in subdivision 7b upon which 
 11.29  contributions were made that produces the highest amount for a 
 11.30  five successive-year period of formula service credit, but not 
 11.31  to exceed the equivalent of 60 successive monthly applicable 
 11.32  compensation payments, or for all years of formula service 
 11.33  credit if the person has credit for less than five years of 
 11.34  formula service. 
 11.35     Sec. 2.  Minnesota Statutes 1998, section 354A.011, is 
 11.36  amended by adding a subdivision to read: 
 12.1      Subd. 7b.  [BASE SALARY.] (a) For an elementary or 
 12.2   secondary school teacher, "base salary" means the annual 
 12.3   contract or equivalent regular salary of the teacher for the 
 12.4   teacher's regular teaching duties and does not include 
 12.5   extracurricular activity compensation. 
 12.6      (b) For any other teacher, including a school district 
 12.7   superintendent or an elementary or secondary school principal or 
 12.8   other administrator, base salary means salary as defined in 
 12.9   subdivision 24. 
 12.10     Sec. 3.  Minnesota Statutes 1998, section 354A.011, is 
 12.11  amended by adding a subdivision to read: 
 12.12     Subd. 14b.  [EXTRACURRICULAR ACTIVITY 
 12.13  COMPENSATION.] "Extracurricular activity compensation" means 
 12.14  that portion of the compensation for teaching services paid to a 
 12.15  teacher covered by subdivision 7b, paragraph (a), for 
 12.16  extracurricular activity management. 
 12.17     Sec. 4.  Minnesota Statutes 1998, section 354A.011, is 
 12.18  amended by adding a subdivision to read: 
 12.19     Subd. 14c.  [EXTRACURRICULAR ACTIVITY MANAGEMENT.] (a) 
 12.20  "Extracurricular activity management," for purposes of 
 12.21  subdivisions 7b and 14b, means a teaching duty that has 
 12.22  substantial direct student contact, is performed by an 
 12.23  elementary or secondary school teacher for a separate or 
 12.24  determinable amount of compensation, is performed in addition to 
 12.25  the person's regular or base teaching duties, and is not 
 12.26  uniformly performed by all or substantially all other similarly 
 12.27  situated teachers.  
 12.28     (b) Extracurricular activity management includes the 
 12.29  management of interscholastic and intramural competitive 
 12.30  activities. 
 12.31     (c) Extracurricular activity management does not include 
 12.32  any activities by a school district superintendent or an 
 12.33  elementary or secondary school principal or other category of 
 12.34  school administrator. 
 12.35     Sec. 5.  Minnesota Statutes 1998, section 354A.021, is 
 12.36  amended by adding a subdivision to read: 
 13.1      Subd. 9.  [BASE SALARY AND EXTRACURRICULAR ACTIVITY 
 13.2   COMPENSATION REPORTING.] (a) The board shall adopt necessary 
 13.3   standards for the reporting of base salary amounts and 
 13.4   extracurricular activity compensation amounts.  Reporting of 
 13.5   base salary amounts and extracurricular activity compensation 
 13.6   amounts is the responsibility of an employing unit with members 
 13.7   covered by the fund.  An employing unit with a member covered by 
 13.8   the fund who manages an extracurricular activity must comply 
 13.9   with the standards in reporting salary and compensation amounts. 
 13.10     (b) No amount may be credited as extracurricular activity 
 13.11  compensation paid before July 1, 2000, unless the teacher 
 13.12  involved supplies adequate documentation of the amount of the 
 13.13  extracurricular teaching activity compensation and the length of 
 13.14  the extracurricular teaching activity management service.  The 
 13.15  extracurricular teaching activity compensation must have been 
 13.16  salary subject to member contributions at the time the service 
 13.17  was rendered.  The documentation must be supplied at least six 
 13.18  months before the teacher's effective date of retirement. 
 13.19     (c) The board shall establish standards for the 
 13.20  documentation required to be provided by a teacher to establish 
 13.21  the existence and amount of any extracurricular activity 
 13.22  compensation received before July 1, 2000.  Pre-July 1, 2000, 
 13.23  extracurricular activity compensation is only creditable if 
 13.24  contemporaneous member contributions were made on the 
 13.25  extracurricular activity compensation amount.  The documentation 
 13.26  standards may not unreasonably differentiate between the various 
 13.27  types of teaching personnel engaged in extracurricular activity 
 13.28  management and may not differentiate between the various school 
 13.29  districts in a given school year. 
 13.30     Sec. 6.  Minnesota Statutes 1998, section 354A.31, 
 13.31  subdivision 4, is amended to read: 
 13.32     Subd. 4.  [COMPUTATION OF THE NORMAL COORDINATED RETIREMENT 
 13.33  ANNUITY; MINNEAPOLIS AND ST. PAUL FUNDS.] (a) This subdivision 
 13.34  applies to the coordinated programs of the Minneapolis teachers 
 13.35  retirement fund association and the St. Paul teachers retirement 
 13.36  fund association.  
 14.1      (b) The normal coordinated retirement annuity shall be is 
 14.2   an amount equal to a retiring coordinated member's average 
 14.3   salary as defined in section 354A.011, subdivision 7a, 
 14.4   multiplied by the retirement annuity formula percentage.  
 14.5   Average salary for purposes of this section shall mean an amount 
 14.6   equal to the average salary upon which contributions were made 
 14.7   for the highest five successive years of service credit, but 
 14.8   which shall not in any event include any more than the 
 14.9   equivalent of 60 monthly salary payments.  Average salary must 
 14.10  be based upon all years of service credit if this service credit 
 14.11  is less than five years. 
 14.12     (c) This paragraph, in conjunction with subdivision 6, 
 14.13  applies to a person who first became a member or a member in a 
 14.14  pension fund listed in section 356.30, subdivision 3, before 
 14.15  July 1, 1989, unless paragraph (d), in conjunction with 
 14.16  subdivision 7, produces a higher annuity amount, in which case 
 14.17  paragraph (d) will apply.  The retirement annuity formula 
 14.18  percentage for purposes of this paragraph is the percent 
 14.19  specified in section 356.19, subdivision 1, per year for each 
 14.20  year of coordinated service for the first ten years and the 
 14.21  percent specified in section 356.19, subdivision 2, for each 
 14.22  year of coordinated service thereafter.  
 14.23     (d) This paragraph applies to a person who has become at 
 14.24  least 55 years old and who first becomes a member after June 30, 
 14.25  1989, and to any other member who has become at least 55 years 
 14.26  old and whose annuity amount, when calculated under this 
 14.27  paragraph and in conjunction with subdivision 7 is higher than 
 14.28  it is when calculated under paragraph (c), in conjunction with 
 14.29  the provisions of subdivision 6.  The retirement annuity formula 
 14.30  percentage for purposes of this paragraph is the percent 
 14.31  specified in section 356.19, subdivision 2, for each year of 
 14.32  coordinated service.  
 14.33     Sec. 7.  Minnesota Statutes 1998, section 354A.31, 
 14.34  subdivision 4a, is amended to read: 
 14.35     Subd. 4a.  [COMPUTATION OF THE NORMAL COORDINATED 
 14.36  RETIREMENT ANNUITY; DULUTH FUND.] (a) This subdivision applies 
 15.1   to the new law coordinated program of the Duluth teachers 
 15.2   retirement fund association. 
 15.3      (b) The normal coordinated retirement annuity is an amount 
 15.4   equal to a retiring coordinated member's average salary as 
 15.5   defined in section 354A.011, subdivision 7a, multiplied by the 
 15.6   retirement annuity formula percentage.  Average salary for 
 15.7   purposes of this section means an amount equal to the average 
 15.8   salary upon which contributions were made for the highest five 
 15.9   successive years of service credit, but may not in any event 
 15.10  include any more than the equivalent of 60 monthly salary 
 15.11  payments.  Average salary must be based upon all years of 
 15.12  service credit if this service credit is less than five years. 
 15.13     (c) This paragraph, in conjunction with subdivision 6, 
 15.14  applies to a person who first became a member or a member in a 
 15.15  pension fund listed in section 356.30, subdivision 3, before 
 15.16  July 1, 1989, unless paragraph (d), in conjunction with 
 15.17  subdivision 7, produces a higher annuity amount, in which case 
 15.18  paragraph (d) applies.  The retirement annuity formula 
 15.19  percentage for purposes of this paragraph is the percent 
 15.20  specified in section 356.19, subdivision 1, per year for each 
 15.21  year of coordinated service for the first ten years and the 
 15.22  percent specified in section 356.19, subdivision 2, for each 
 15.23  subsequent year of coordinated service. 
 15.24     (d) This paragraph applies to a person who is at least 55 
 15.25  years old and who first becomes a member after June 30, 1989, 
 15.26  and to any other member who is at least 55 years old and whose 
 15.27  annuity amount, when calculated under this paragraph and in 
 15.28  conjunction with subdivision 7, is higher than it is when 
 15.29  calculated under paragraph (c) in conjunction with subdivision 
 15.30  6.  The retirement annuity formula percentage for purposes of 
 15.31  this paragraph is the percent specified in section 356.19, 
 15.32  subdivision 2, for each year of coordinated service. 
 15.33     Sec. 8.  [354A.45] [DEFINED CONTRIBUTION BENEFIT DERIVED 
 15.34  FROM CONTRIBUTIONS ON EXTRACURRICULAR COMPENSATION.] 
 15.35     Subdivision 1.  [POST-JULY 1, 2000, CONTRIBUTIONS.] (a) 
 15.36  Member contributions on extracurricular compensation received by 
 16.1   a teacher after June 30, 2000, and the related employer 
 16.2   contributions, after deduction of the applicable amount 
 16.3   representing administrative expenses, must be deposited in a 
 16.4   separate account established for the member and must be used to 
 16.5   purchase shares in one or more account of the Minnesota 
 16.6   supplemental investment fund under section 11A.17.  The teacher 
 16.7   must specify, on a form prescribed by the executive director, 
 16.8   the percentage of the total contribution available for deposit 
 16.9   to be used to purchase shares in each account of the 
 16.10  supplemental investment fund. 
 16.11     (b) The teacher may indicate, in writing on a form 
 16.12  prescribed by the executive director, a choice of options for 
 16.13  subsequent purchases of shares.  The choice filed governs the 
 16.14  purchase of shares until a different choice is filed.  If no 
 16.15  initial option is chosen, 100 percent of the available 
 16.16  contribution amounts must be used to purchase shares in the 
 16.17  income share account.  A change in the investment option is 
 16.18  effective no later than the first compensation payment date 
 16.19  first occurring 30 days after the change form is filed. 
 16.20     (c) A teacher also may change the investment option that 
 16.21  was selected for all or a portion of the shares in the 
 16.22  supplemental investment fund previously purchased.  Changes in 
 16.23  past investment options must be effected as soon as the cash 
 16.24  flow to the applicable account practically permits, but not 
 16.25  later than six months after the requested change. 
 16.26     Subd. 2.  [PRE-JULY 1, 2000, CONTRIBUTIONS.] (a) Member 
 16.27  contributions on pre-July 1, 2000, documented or reported 
 16.28  extracurricular activity compensation and the related employer 
 16.29  contributions, after deduction of the accumulated administrative 
 16.30  expense, plus investment income on those amounts credited at the 
 16.31  rate credited to members' accounts under section 354.44, 
 16.32  subdivision 2, must be deducted from the teachers retirement 
 16.33  fund, transferred to the Minnesota supplemental investment fund, 
 16.34  and deposited to the credit of the separate account of the 
 16.35  teacher. 
 16.36     (b) Reported extracurricular activity compensation is 
 17.1   compensation for extracurricular teaching services that the 
 17.2   applicable school district has certified to the executive 
 17.3   director as having been paid before July 1, 2000.  The executive 
 17.4   director may request additional verification as to the amount 
 17.5   and the nature of the reported extracurricular activity 
 17.6   compensation and makes the final determination of the amounts 
 17.7   appropriate for transfer.  The decision of the executive 
 17.8   director is appealable under section 354.071. 
 17.9      (c) Documented extracurricular activity compensation is 
 17.10  compensation paid before July 1, 2000, for extracurricular 
 17.11  teaching services that the applicable teacher has identified by 
 17.12  supplying copies of applicable teaching contracts, federal 
 17.13  Internal Revenue documents, and other relevant information.  The 
 17.14  executive director may request additional information from the 
 17.15  teacher or from the applicable school district as to the amount 
 17.16  and the nature of the documented extracurricular activity 
 17.17  compensation and makes the final determination of the amounts 
 17.18  appropriate for transfer.  The decision of the executive 
 17.19  director is applicable under section 354.071. 
 17.20     Subd. 3.  [DEFINED CONTRIBUTION RETIREMENT ANNUITY.] (a) 
 17.21  Upon retirement under section 354.44, the retiring teacher is 
 17.22  also eligible to receive a defined contribution retirement 
 17.23  annuity under this section.  The value of the shares to the 
 17.24  credit of the retiring teacher must be transferred to the 
 17.25  Minnesota postretirement investment fund.  The annuity must be 
 17.26  based on the amount to the credit of the retiring teacher and 
 17.27  the age of the retiring teacher at retirement, calculated under 
 17.28  the reserve basis used by the teachers retirement association in 
 17.29  determining pensions and reserves. 
 17.30     (b) An annuity under this subdivision accrues on the first 
 17.31  day of the first full month after the retirement application is 
 17.32  received or after teaching service terminates, whichever is 
 17.33  later.  
 17.34     Subd. 4.  [DEFINED CONTRIBUTION DISABILITY BENEFIT.] (a) A 
 17.35  teacher covered by this section, upon becoming totally and 
 17.36  permanently disabled, has the option to receive: 
 18.1      (1) the value of the person's total shares; or 
 18.2      (2) an annuity under subdivision 3 based on the value of 
 18.3   the person's total shares. 
 18.4      (b) The disability benefit accrues on the first day of the 
 18.5   month next following the date of disability. 
 18.6      (c) The disability benefit must be based on the 
 18.7   disabilitant's age when the benefit begins to accrue.  The 
 18.8   shares to the credit of the disabilitant in the Minnesota 
 18.9   supplemental investment fund must be valued as of the end of the 
 18.10  month following authorization of the payment of the disability 
 18.11  benefit. 
 18.12     (d) The disability benefit is not subject to any reduction 
 18.13  for amounts received or receivable under the applicable workers' 
 18.14  compensation laws. 
 18.15     (e) A person who returns to teaching after receiving 
 18.16  disability benefits must have those disability benefits 
 18.17  suspended pending the payment of a future retirement annuity 
 18.18  under subdivision 3.  Upon returning to teaching, the person is 
 18.19  not obligated or permitted to repay any previously received 
 18.20  disability benefits. 
 18.21     Subd. 5.  [DEFINED CONTRIBUTION DEATH BENEFIT.] (a) If a 
 18.22  teacher covered by this section dies leaving a spouse and having 
 18.23  no named beneficiary, the spouse has the option to receive: 
 18.24     (1) the value of the decedent's total shares; or 
 18.25     (2) an annuity when the spouse attains the age of 55 years, 
 18.26  calculated under subdivision 3 based on the value of the 
 18.27  decedent's total shares. 
 18.28     (b) If a teacher covered by this section dies and has named 
 18.29  a beneficiary, the beneficiary is entitled to receive the value 
 18.30  of the decedent's total shares. 
 18.31     (c) If a teacher covered by this section dies and leaves no 
 18.32  spouse, has named no beneficiary, but leaves a surviving child, 
 18.33  surviving children, a surviving parent, or surviving parents, 
 18.34  the value of the decedent's total shares are payable to the 
 18.35  child or to the children in equal shares, or if none, to the 
 18.36  surviving parent or to the surviving parents in equal shares. 
 19.1      (d) If a teacher covered by this section dies leaving no 
 19.2   surviving spouse, surviving child, or surviving parent and has 
 19.3   not named a beneficiary, the decedent's estate is entitled to 
 19.4   the value of the decedent's total shares. 
 19.5      (e) A decedent's total shares must be valued as of the end 
 19.6   of the month following the teacher's death. 
 19.7      Subd. 6.  [DEFINED CONTRIBUTION WITHDRAWAL BENEFIT.] (a) No 
 19.8   withdrawal of amounts from the account of a teacher covered by 
 19.9   this section may occur before the termination of teaching 
 19.10  service. 
 19.11     (b) Upon the termination of teaching service or thereafter, 
 19.12  a former teacher, upon application, is entitled to withdraw the 
 19.13  value of the person's total shares.  The withdrawal benefit is 
 19.14  payable 30 days following the termination of teaching service or 
 19.15  30 days following the filing of the application for the benefit, 
 19.16  whichever is later. 
 19.17     (c) The share value for a withdrawal benefit must be 
 19.18  determined as of the end of the month following the filing of 
 19.19  the application for the benefit. 
 19.20     (d) The withdrawal benefit may not be repaid. 
 19.21     Sec. 9.  [EFFECTIVE DATE.] 
 19.22     Sections 1 to 8 are effective on July 1, 2000. 
 19.23                             ARTICLE 3 
 19.24         FEE FOR DOCUMENTING PRIOR EXTRACURRICULAR TEACHING 
 19.25                      SERVICE AND COMPENSATION 
 19.26     Section 1.  [122A.59] [EXTRACURRICULAR TEACHING ACTIVITY 
 19.27  MANAGERS; DOCUMENTATION FEE AUTHORITY.] 
 19.28     To cover the cost of documenting prior extracurricular 
 19.29  teaching activity management service and compensation under 
 19.30  section 354.07, subdivision 10, or 354A.021, subdivision 9, a 
 19.31  school district may charge the extracurricular teaching activity 
 19.32  manager a documentation fee, not to exceed $....... 
 19.33     Sec. 2.  [EFFECTIVE DATE.] 
 19.34     Section 1 is effective on the day following final enactment.
 19.35                             ARTICLE 4 
 19.36           DEPARTMENT OF CHILDREN, FAMILIES, AND LEARNING 
 20.1     SPECIFICATION OF ELIGIBLE EXTRACURRICULAR ACTIVITY MANAGERS 
 20.2      Section 1.  [122A.591] [SPECIFICATION OF ELIGIBLE 
 20.3   EXTRACURRICULAR ACTIVITY MANAGEMENT DUTIES.] 
 20.4      For purposes of the special retirement plan provisions 
 20.5   contained in section 354.515 or 354A.385, the commissioner shall 
 20.6   adopt reasonable and appropriate emergency and permanent rules 
 20.7   consistent with sections 354.05, subdivision 35d, and 354A.011, 
 20.8   subdivision 14b, defining the various teaching duties that 
 20.9   constitute extracurricular activity management. 
 20.10     Sec. 2.  [EFFECTIVE DATE.] 
 20.11     (a) Section 1 is effective on the day following final 
 20.12  enactment. 
 20.13     (b) The commissioner of children, families, and learning 
 20.14  shall issue emergency rules under section 1 as soon as 
 20.15  practicable following the effective date specified in paragraph 
 20.16  (a).